Fangda Special Steel (600507) semi-annual report comment: ton steel profits remain high, second quarter net profit increased 24%
Interim report overview.
From January to June 2019, the company realized operating income of 82.
530,000 yuan, an increase of 0 in ten years.
18%; operating profit is 14.
4.0 billion, a decline of 20 per year.
06%; net profit attributable to owners of the parent company is 10.
55 ppm, a decrease of 19 per year.
By quarter, the net profit attributable to owners of the parent company in the second quarter was 5.
85 ppm, with a year-on-month change of -21.
85% / 24.
The explosion accident caused the output to decrease.
In the baseline report, the company’s iron, steel, and volume are 163.
71 Initially, at least 3 drops respectively.
03% / 5.
71% / 6.
An unexpected safety accident occurred at the end of May, and the report may be that the company’s No. 2 blast furnace was in shutdown for the entire month of June.
The No. 2 blast furnace has a capacity of 1,050 cubic meters, and the molten iron production capacity is about 125 tons per year, which affects the molten iron amount by about 10 per month.
The product rose slightly, but part of the gross profit space was swallowed by cost.
According to calculations, the company’s short-term steel content in the first half of the report was about 3,731 yuan / ton, up 12 yuan / ton per ton; but on the cost side, the company’s average ton steel cost in the first half of the year was 2,792 yuan / ton, an increase of more than 240 yuan / ton.
Affected by the sharp rise in iron ore prices, part of the company’s gross profit space was swallowed up by raw material costs. In the first half of the year, the company’s gross profit per ton of steel was 938 yuan / ton, which gradually decreased by 228 yuan / ton.
Our model estimates that the average gross profit per ton of steel rebar in the first half of the industry is about 438 yuan / ton. The company is still much higher than the industry’s nearly 500 yuan per ton, which is also in line with our previous expectations of the company.
In terms of quarters, the volume and cost of the company’s products increased in the second quarter, but the company’s cost control capabilities expanded. The cost per ton of steel rose less than the price. The gross profit per ton of steel was 978 yuan / ton, an increase of 81 yuan / ton from the first quarter.
Beneficial ore prices rose, and Tongda Iron Processing resumed profitability.
Reporting ore, benefiting from the rapid growth of iron ore prices, the company increased the speed of iron ore mining, and the iron ore output in the first half of the year was about 42.
48 tons, about 670 yuan / ton ore, gross profit per ton 433 yuan / ton.
Subsidiary Tongda Tiexuan began to resume profit, and achieved a net profit of about 1 in the first half of the year.
1.4 billion, the company’s net profit ratio is 10.
8%, an average of 52.49 million yuan in the same period last year.
It is estimated that the total operating income for 2019-2021 will be 160.
08/170.77 trillion, an annual increase of -7.
4% / 5.
6% / 1.
0%; net profit attributable to owners of the parent company is 19.
71 ppm, an increase of -32 each year.
5% / 10.
3% / 22.
6%; the returns are 1.
84 yuan, corresponding to PE is 6.
Relatively speaking, the fundamentals of supply and demand in Jiangxi Province are significantly better than the overall industry level. Under the industry downturn cycle, regional prices can show relative resistance to decline.
And the company’s high-level cost control will be more prominent in the industry cycle, the ton steel profit has always maintained the industry’s leading position, and has a high dividend return market.
“Excellent profit and high dividends” can bring the company’s long-term investment 深圳桑拿网 attractiveness. We maintain the “Buy” investment rating.
Risk reminder: demand forecast exceeds expected risk; the company’s blast furnace production recovery progress gradually exceeds the expected risk; and the risk of uncertainty of continued high dividends.